JD (NASDAQ:JD), China’s second biggest ecommerce company, saw RMB63.0 billion (US$10.2 billion) in consumer sales [1] in Q2 2014, the firm revealed today in its newest earnings report. That expenditure by its users is up 107 percent on Q2 2013. That came from 163.7 million fulfilled orders during the three-month period. About 24 percent of those came from mobile shoppers.

JD, which raised $1.78 billion in its US IPO in May, pulled in RMB28.6 billion (US$4.6 billion) in revenue during Q2, which is up 64 percent in the past year. The estore made a slim operating loss of US$1.9 million in Q2, aside from non-cash costs related to the recent Tencent deal. (UPDATE: The original article mis-identified non-cash losses of RMB582.5 million (US$93.9 million) as the net loss; but those were costs primarily related to the Tencent strategic partnership. That sentence has been removed and replaced).

JD is a lot like Amazon. Most orders are shipped direct to consumers from its own warehouses, but it also has third-party merchants on an open marketplace. Its primary rivals are Alibaba’s marketplaces, Tmall and Taobao. In the business-to-consumer (B2C) sector, Tmall and JD collectively dominate with over 70 percent market share, according to data from iResearch.

JD now has 38.1 million active customers, which has nearly doubled in the past year.

]]>https://www.techinasia.com/jd-10-dillion-dollars-consumer-shopping-q2-2014-ecommerce-in-china/feed/0Not as big as Alibaba, but upcoming IPO for rival JD could value it at $24.6 billionhttps://www.techinasia.com/china-ecommerce-jd-valuation-over-24-billion-dollars-ahead-ipo/
https://www.techinasia.com/china-ecommerce-jd-valuation-over-24-billion-dollars-ahead-ipo/#commentsTue, 13 May 2014 09:30:28 +0000https://www.techinasia.com/?p=177338

China’s JD is edging closer to its US IPO, having first filed for it in January. JD’s latest update reveals that the ecommerce company is pricing its shares in the US$16 to $18 range, which values the site at up to $24.6 billion once it eventually hits the markets.

JD – formerly called 360Buy – will list on NASDAQ with the ‘JD’ stock ticker. It’ll raise up to $1.7 billion from the IPO.

JD’s updated prospectus has also refreshed its corporate numbers, showing that it now has 47.4 million active user accounts. It sold RMB 125.5 billion ($20.7 billion) worth of items in 2013.

This IPO will inevitably be eclipsed by that of JD’s larger rival, Alibaba. After first filing earlier this month, Alibaba is on course to raise about $15 billion at an estimated valuation of $170 billion.

While Alibaba’s Tmall and Taobao dominate the consumer-oriented eshopping sector in China, JD differentiates itself by mostly shipping items directly to consumers, rather than Alibaba’s model of serving as just a virtual storefront for small merchants and major brands.

JD’s upcoming IPO could be boosted by the recent investment from Tencent (HKG:0700) that will likely see JD become integrated into WeChat, Tencent’s hugely popular messaging app.

Amid swirling rumors that Tencent (HKG:0700) is keen to boost its flagging e-commerce operations by taking a stake in the Amazon-esque JD, the Wall Street Journal claims today that Tencent has appointed Barclays to advise on taking a stake in JD. That’s according to the mythical beast that is “a person familiar with the matter.”

JD (pictured above) – formerly called 360Buy – is China’s second largest e-store, and the closest rival in terms of market share to Alibaba’s Tmall. Investing in JD would give Tencent more leverage in its multi-dimensional rivalry with Alibaba in everything from e-commerce to messaging apps.

Tencent has its own QQ Buy and 51Buy e-stores, but the web giant has struggled with e-commerce relative to its huge success in other areas like social media and gaming. One or both of those e-stores could be subsumed into JD in the event of taking a large stake.

JD’s filing with the SEC today reveals (as shown in the image above) that the Beijing-based company now has 35.8 million active users accounts, 25.7 million products, and 82 warehouses in 34 cities across China backed up by 1.453 delivery stations in 460 cities. In addition to all that infrastructure, JD has its own delivery service for the final leg from delivery stations to e-shoppers’ doorsteps.

Chinese e-commerce company JD – the closest rival to Alibaba’s Tmall in China – has acquired a startup company to boost its travel offerings. The deal, for an undisclosed sum, sees JD snap up Hotelvp, according to Donews. Hotelvp makes an app (pictured above) for iOS, Android, and Windows Phone for finding last-minute hotel deals.

The Amazon-like JD already covers online hotel booking, as well as flight tickets, car hiring, package tours, and train tickets. JD, formerly called 360Buy, first launched its online hotel offerings in February 2012.

Hotelvp launched in 2011, and later raised $4 million in series A funding. It was founded by a bunch of executives from Newegg China who already have plenty of experience in China’s cut-throat e-commerce industry.

As well as last-minute hotel deals, Hotelvp lets users book hotels at any time, and has 3,000 hotels listed. It’s not clear if Hotelvp will be rebranded and subsumed into JD’s line-up at trip.jd.com.

Beijing-based online retailer Jingdong, previously known as 360Buy, reportedly seeks to raise $2 billion in an IPO in the second half of this year, according to Bloomberg. Bloomberg cited “three people with knowledge of the matter.”

When Tech in Asia reached out to Jingdong for comment, their spokesperson replied, “JD.com has a corporate policy that it does not comment on market rumors.”

Bloomberg’s sources say Jingdong want to list on the US stock market, but Hong Kong is also on the table. Jingdong wants to avoid listing at the same time as its largest competitor, e-commerce titan Alibaba, which is also expected to go down as one of the biggest IPOs in financial history sometime this year.

Rumors of a potential IPO for Jingdong first surfaced back in 2011, when the company’s owner mentioned it might happen in 2013 or later.

While Alibaba is the largest e-commerce company in China, most of it’s sales are C2C, while Jingdong is a B2C retailer. The company is a trusted store when it comes to buying genuine products, everything from baby formula to iPhones.

]]>https://www.techinasia.com/bloomberg-chinese-ecommerce-retailer-jingdong-seeking-2-billion-ipo/feed/0Chinese e-store Jingdong set to pull in over $16 billion in sales in 2013https://www.techinasia.com/china-jingdong-ecommerce-sales-revenue-over-16-billion-dollars-2013/
https://www.techinasia.com/china-jingdong-ecommerce-sales-revenue-over-16-billion-dollars-2013/#commentsMon, 23 Dec 2013 12:00:07 +0000https://www.techinasia.com/?p=158579

Chinese e-store Jingdong is on course to pull in over $16.35 billion in sales revenue in 2013, according to founder and CEO Liu Qiangdong. Speaking to journalists this afternoon, Liu added, “[It’s] a remarkable 10,000-fold increase from our first year of operations and a two thirds increase from last year.”

Jingdong – formerly called 360Buy – is the second largest Amazon-like site in China. It’s behind Alibaba’s Tmall in terms of market share, according to data from iResearch. With China’s whole business-to-consumer e-shopping sector worth $71 billion in Q2 this year, Jingdong has 17.1 percent market share to Tmall’s dominant 50.7 percent. Jingdong differs from Tmall in that it buys and ships its own stock, whereas Tmall serves as an online mall for brands and merchants.

The Jingdong homepage today. Click to enlarge.

Over 140 million shoppers

Liu gave out some current numbers for the site: over 140 million registered users; over 100 million users seen on its mobile shopping apps; 15 percent of orders now coming from smartphones; about 220 million page-views from PC-based shoppers; 10 million products in stock; and 1,400 delivery stations throughout China.

Jingdong’s CEO also revealed some strategies for the coming year:

“As we begin our second decade of operations, we have ambitious goals in 2014 for developing our technology, our O2O [online-to-offline] business, financing, lower-tier city penetration, and the internationalization of the business with JD.com Global. We now have nearly half of China’s direct B2C e-commerce business and almost 20 percent of the country’s overall e-commerce market, and we expect this to continue to grow for JD.com.

Ah, the sweet’n’sour taste of petty revenge. One of China’s top e-commerce sites, Jingdong, will axe support soon for login via Sina Weibo accounts. The moves comes five months after Jingdong’s biggest e-shopping rival, Alibaba, invested nearly $600 million to take a stake in the Twitter-esque Sina Weibo.

A Jingdong representative explained to the Global Times newspaper:

Given that our partnership with Sina Weibo will expire soon, we expect Weibo users to apply for accounts on [Jingdong] so as to continue their online purchases. Their previous buying data will be preserved in the new accounts.

“Soon” means the end of September.

The cold shoulder

Alibaba operates Tmall and Taobao, two of the biggest challengers to Jingdong in China’s ultra-competitive e-commerce market. Alibaba is trying to be more social and explore social commerce, hence its major investment in Sina Weibo.

The Chinese web and tech sector is known for its many bitter rivalries, so there’s nothing unusual in a rival’s product being given the cold shoulder. Alibaba’s Taobao did something similar last month.

Sina Weibo users who used that login to create a Jingdong account will need to make a fresh username. All the account details will be transferred to the non-Weibo account. Jingdong still accepts third-party login via eight other services, including Tencent’s QQ.

]]>https://www.techinasia.com/jingdong-ditches-weibo-login-option/feed/0Jingdong invests in food delivery service Daojiahttps://www.techinasia.com/jingdong-invests-food-delivery-service-daojia/
https://www.techinasia.com/jingdong-invests-food-delivery-service-daojia/#commentsMon, 02 Sep 2013 15:40:14 +0000https://www.techinasia.com/?p=140657Chinese online food ordering platform Daojia announced today the completion of its series C financing, with Morningside Ventures and B2C e-commerce site Jingdong (formerly 360Buy) as the primary investors. In its press release, Daojia cites iResearch data projecting that China’s online-to-offline market will have 300 million customers in 2015, which theoretically would put Daojia in a strong position since people like eating, and Daojia already delivers food from nearly 2,000 restaurants.

The downside is that the company currently only serves Beijing and Shanghai. If it doesn’t expand, there’s no way it will have access to anything close to a 300 million person market, considering the total population of both of those cities is barely above 40 million. Of course, the influx of funds should be a boon to any expansion plans Daojia may have, but this sort of business isn’t easy to scale. It’s possible Daojia plans to stay focused on Beijing and Shanghai on the assumption that those markets will likely be among the fastest-growing in China when it comes to embracing buying food online.

From Jingdong’s perspective, the investment seems to make a lot of sense. E-commerce is right in its wheelhouse, so Jingdong should be able to boost Daojia’s value by helping on the technical side of things (its website could definitely use a makeover). And Daojia gives Jingdong a window into the online-to-offline market, which is expected to grow quite quickly over the next few years.

]]>https://www.techinasia.com/jingdong-invests-food-delivery-service-daojia/feed/0China’s e-commerce market to hit $71 billion in sales in Q2; these are the top 10 e-storeshttps://www.techinasia.com/china-ecommerce-market-share-stats-q2-2013/
https://www.techinasia.com/china-ecommerce-market-share-stats-q2-2013/#commentsWed, 28 Aug 2013 03:30:03 +0000https://www.techinasia.com/?p=139660China’s e-shoppers now number over 240 million, who collectively spend an average of $40,000 per second. But the nation’s e-commerce boom is far from hitting its peak. New statistics from iResearch show that China’s e-commerce market will see an estimated total of RMB 437.13 billion ($71 billion) spent [1] in Q2 2013, a new record high that is up 45.2 percent from the same period last year.

The B2C top 10 in China

So who are the top 10 sites in this monstrously massive market? Focusing solely on the B2C sector, we see that it’s lead by Alibaba’s Tmall, which is actually an open platform (B2B2C) for brands and retailers, sort of like a virtual mall. Tmall now has 50.6 percent market share of sales (see pie chart below) in this sector, up from 41.5 percent in Q2 last year.

Also gaining market share are Jingdong (called 360Buy last year), Tencent, Suning (all general Amazon-like sites), and Yihaodian (specializes in food), while luxury flash sales site VIPShop leaps into the top 10 for the first time:

Amazon China and the very similar Dangdang have been stagnant in terms of market share in the past year, whilst Uniqlo-style clothing e-tailer Vancl suffered a big drop, losing over half of its market share by sales.

Amateur Chinese shopkeepers are still the kings

While the B2C e-commerce market in China is growing well, the nation’s amateur shopkeepers are still the kings of e-tailing. China’s B2C only sector is only worth $25.6 billion in terms of sales, and all the rest of that whopping $71 billion figure goes to the C2C sector. That means the numerous stores on sites like Alibaba’s Taobao and Tencent’s Paipai. But B2C shopping sites have now grown to represent 36.9 percent of the total e-commerce market:

Why is that happening? iResearch notes that B2C e-stores are increasingly high profile, especially with their aggressive sales promotions in this cut-throat industry; that has also meant that C2C sellers are losing their (usually dubious, sales tax-dodging) price advantage. Furthermore, increasing concern over poor quality or fake items is pushing consumers to more reputable sites.

China’s top B2C e-commerce site has spread its wings today and landed in Singapore. Jingdong has partnered with Singaporean e-tailer iKnow to makes this happen, and now Jingdong has its first ever regional international site in both Chinese and English (here and here).

Today’s announcement says that, due to “strong demand in the country for Chinese cultural products, Singapore is the obvious market” for Jingdong’s first regional effort.

Jingdong launched a worldwide site last October, but that JD Global store only ships items from the company’s Chinese warehouses. But for JD Global’s Singaporean customers, the partnership with iKnow means it can ship items quickly from within the lion city. The announcement explains:

The Singapore site already offers more than 300,000 [products] and will further expand in the coming months. Through JD.com Global’s strategic partnership with iKnow, the site provides tailored payment and delivery options for local customers, including stations inside iKnow’s retail stores where customers can pick up their goods ordered on the Singapore site free of delivery charges. Customers can also receive comprehensive, high-quality after-sales services at the iKnow pick-up stations. In addition, customers have access to the same flexible payment options for JD.com purchases in Singapore that Jingdong is known for in China, such as cash-on-delivery.

]]>https://www.techinasia.com/jingdong-launches-jd-site-singapore/feed/1Jingdong Headed for US IPO?https://www.techinasia.com/jingdong-headed-ipo/
https://www.techinasia.com/jingdong-headed-ipo/#commentsTue, 16 Jul 2013 00:30:09 +0000https://www.techinasia.com/?p=132660Is Jingdong aiming for an initial public offering on the US market? That’s the rumor being passed around in the Chinese tech media, according to the Beijing Business News. The vaguely-sourced story has it that the company has set a timeline that might see it appear on the market before Alibaba. Alibaba, Jingdong’s largest domestic rival, has already admitted that it is preparing for an IPO. Supposedly, Jingdong is preparing for one too, and has already engaged PWC China to begin an audit.

A spokesman for Jingdong told the Beijing Business News that the company does not have a specific timetable for an IPO. But an anonymous source told the paper that Jingdong CEO Liu Qiangdong’s frequent trips abroad could signal that he is preparing for an IPO. Of course, this is all just a rumor for now. We have contacted Jingdong for comment and will update this story if we hear back.

That said it certainly wouldn’t be a surprise to see the company heading for an IPO. We put Jingdong on our list of the most likely China IPOs this year back in January, although that was before the rebranding so the company was still named 360Buy at the time.

Earlier today we looked at a report that has counted up $6.9 billion in investments among Asian e-commerce sites from 2010 to the present day. A mesmerising $4.8 billion of all that venture capital went to e-stores in China.

Despite that amazing marquee number of $4.8 billion, China’s e-commerce landscape is marred by a woeful lack of acquisitions. Basically, Chinese e-stores either exit via an IPO (where China excels), or struggle on as an independent company. Or die off.

The aforementioned report by venture capital database CB Insights points out this huge disparity. Amidst all that investment in Chinese e-commerce (way ahead of the $978 million poured into such businesses by VCs in India), China is actually dwarfed by India when it comes to deals such as acquisitions:

No deal?

So the problem is that no-one is acquiring fellow Chinese e-stores for their own advancement. It’s an issue seen throughout the entire national web and tech industries. It’s cheaper to throw people at a problem in China. Despite it being a market where an estimated $177 billion will be spent by shoppers in 2013, the nation’s e-commerce giants – like Alibaba, Jingdong (formerly 360Buy), Suning, Tencent, Dangdang – don’t like spending on acquisitions. Here’s the investment and deal volume in the country in the past three years or so:

Inevitably, that VC and buy-out money is going to the core growth areas in online shopping in China, such as clothing stores and daily deals:

Exit = IPO

Looking on the bright side, China’s e-commerce IPO exits are plentiful, with the most recent being B2B marketplace LightInTheBox hitting the New York Stock Exchange just last week. The upcoming IPO that everyone is waiting for will be the biggest tech IPO that China has ever seen – that will happen once Alibaba (which runs market-leading sites like Taobao and Tmall) sets a date. That could value Alibaba at anywhere from $40 billion (the reported valuation based on its recent Yahoo partial stake buy-back) to the fevered heights (in some rather overblown headlines) of closer to $100 billion.

Other possible IPOs include Jingdong, Vancl, and travel booking site Qunar.

But this is the more grim scene in China in terms of buy-out style exits:

Sinophile VCs

China’s top overseas VC in terms of making the most deals in e-commerce in the country is IDG, where they’ve made 11 injections of capital. IDG’s most recent was back in January when it ploughed series A funding into discount shopping aggregator Mizhe.

]]>https://www.techinasia.com/china-ecommerce-investments-and-exits-2010-to-2013/feed/0Chinese E-Commerce Giant Jingdong Caught Selling Fake Eye Cream?https://www.techinasia.com/chinese-ecommerce-giant-jingdong-caught-selling-fake-eye-cream/
https://www.techinasia.com/chinese-ecommerce-giant-jingdong-caught-selling-fake-eye-cream/#commentsThu, 13 Jun 2013 02:00:12 +0000https://www.techinasia.com/?p=126647Chinese e-commerce site Jingdong (formerly known as 360Buy) is one of China’s biggest B2C e-commerce platforms, but according to a Beijing News report, one Beijing customer seems to have caught the company red-handed selling a counterfeit product. (Update: See the statement from Jingdong below).

Ms. Wu says she bought some Kiehl’s eye cream from the site during a promotional event earlier this month, but noticed that the product was slightly different when compared to the ones she usually buys at the Kiehl’s retail shop. When she took her online purchase in to ask about it, “the worker there said it was obviously a fake.”

You can see some of the differences in the image below; the tin she bought from Jingdong is on the left and the legit tin is on the right. As you can see, the labels aren’t just different; the creams apparently use wholly different ingredients.

Wu wasn’t the only one with this problem, either. Following the sale, many customers had complaints about the cream they recieved, and a QQ group Wu created to help organize the dissatisfied consumers grew to more than 250 people within just a few days. But Wu says Jingdong won’t accept returns unless the customers have a test report that proves there’s a problem with the product, and chemical composition tests aren’t the easiest thing for everyday consumers to get their hands on.

(Update: The following quote is from the company):

As part of Jingdong’s commitment to offering China’s best online shopping experience, we stringently select and monitor our suppliers to ensure that all products offered on our B2C platform are genuine. We have investigated this matter and based on certification documents provided by our supplier we are confident that the Kiehl’s eye cream products in question received by our customers were genuine. Jingdong will continue to strive for complete customer satisfaction.

Jingdong told the Beijing News that their products are all legitimate and provided by suppliers, but declined to comment on its supplier’s relationship with Kiehl’s or to say who its supplier is. The company also said the differences Ms. Wu experienced could be just be because of the minor changes that can occur in different batches of cream. (We’ve contacted Jingdong to see if it has any additional comment on the matter).

Kiehl’s told the paper that Jingdong is not an authorized online seller of Kiehl’s products, so it’s not clear who the supplier actually is here.

Recently, we wrote about the difficulties Taobao has had in getting rid of fake Adidas products, but Taobao is a C2C platform, and its many users/vendors can be tough to control despite the company’s best efforts. Jingdong has a lot more control over its B2C platform, so if it turns out the company really was selling fakes — intentionally or not — that could really hurt its reputation and possibly push it even further behind e-commerce frontrunner Alibaba.

China’s Jingdong — the e-commerce site formerly known as 360Buy before a recent rebranding — is moving further into cloud-based services, according to a release yesterday that says the company has launched three new cloud services:

JZone, a social community for developers (basically just a collection of documents and a BBS forum)

The new services all seem to be a fairly obvious move towards “platformizing” the e-commerce site and allowing developers better access to develop new apps and better ways to integrate third-party products and vendors into the Jingdong ecosystem. Jingdong’s no Taobao, but it’s big enough that I’m sure some developers will be interested in the new tools.

You can rule international developers out, though, as for the moment these Jingdong platforms come in one language only: simplified Chinese. But given that the company’s recent rebranding seems to have come along with a new push to appeal to the international media, I wouldn’t be surprised if over the next few months other languages are added to the new platforms to make them more functional for non-Chinese developers who might want to get in on the Chinese e-commerce action.

In the meantime, if you can read Chinese or just want to try and click things at random and see if it builds an app for you, the services can be located on their own site, Jcloud. And if you’re looking for a more entertaining J-Zone that’s in English, I recommend this one (NSFW language).

China’s largest Amazon-like e-store, Jingdong, has just rolled out two new supercharged delivery options in six major cities. The night delivery option means that office workers can buy online up to 3pm and have the items arrive at their home between 7pm and 10pm. Even quicker than that is the new three-hour delivery service.

The two options became available last night, Jingdong tells us, but will only be announced and publicized later tonight. The six cities covered for both options are Beijing, Shanghai, Chengdu, Wuhan, Shenyang, and Guangzhou. More cities will be supported in due course. Extra fees are applied for the speedier 3-hour option only (Update: Corrected this detail).

Jingdong – formerly called 360Buy – has what it calls a “last-mile” courier network of vans and e-bikes of its own, launched last summer, to take items from its city warehouses direct to the door of buyers. That means it’s not reliant on third-party couriers.

A race against Alibaba

Jingdong’s newest move is the latest salvo in its battle against e-commerce giant Alibaba. Its two predominant sites, Taobao and Tmall (the latter of which is actually larger than Jingdong in terms of sorta-B2C market share) are online platforms for vendors, and so the company doesn’t hold stock or have warehouses. That means that Jingdong – like other direct B2C e-tailers, such as Amazon China or rival Suning – has the advantage of being able to ship faster (usually) from city depots.

Elsewhere in the world, Google has tried out same-day delivery on a very limited basis in one area of San Francisco, while Amazon is working towards the same thing across the US. But Jingdong’s six cities, covering over 80 million people, is likely the largest-scale fully-implemented roll-out so far.

China’s total B2C e-commerce sales in 2013 are slated to be worth $177 billion this year, with 270 million Chinese netizens being active e-shoppers.

Why are banks afraid? Because we’re doing it right. If [we] weren’t doing it right, what would they have to worry about? If you’re doing things wrong, you can do whatever you want, the bigger the better; either way it’s no threat to me. Am I worried about about what [Jingdong CEO] Liu Qiangdong is doing today? I’ve never even met that guy, he can do whatever he wants for all I care. If the banks start to target you, it’s because you’re doing something right. Ma Yuhua’s thinking on web finance is very true; it’s better to embrace than to resist, because you can’t resist the future. [Resisting e-payment] is like the cart drivers of old Shanghai smashing the taxi cabs when they began to appear. Did that work?

In other words, Ma is saying that Liu Qiangdong’s Jingdong (the artist formerly known as 360Buy) isn’t a threat to Alibaba at all. And while he didn’t put things very nicely, it’s hard to deny that what Jack Ma is saying is true. Alibaba services like Taobao and Tmall dominate the ecommerce market on the web, on mobile, and Jingdong is even further behind many of Alibaba’s other offerings, like payment service Alipay or music service Xiami.

]]>https://www.techinasia.com/jack-ma-give-crap-jingdong-ceo-liu-qiangdong/feed/0Mobile Commerce Worth $4.29 Billion in Q1 in China, But One Company Dominateshttps://www.techinasia.com/china-q1-2013-mobile-commerce-worth-over-4-billion-dollars/
https://www.techinasia.com/china-q1-2013-mobile-commerce-worth-over-4-billion-dollars/#commentsTue, 21 May 2013 09:43:37 +0000https://www.techinasia.com/?p=122703We know that mobile commerce in China was worth $7.8 billion in 2012 – and is expected to rise to $41.4 billion in 2015 – but who are the biggest e-commerce brands among the nation’s mobile shoppers? New statistics from iResearch give us that answer and show that one company seriously dominates.

The clear market leader for mobile-based shopping in China is Taobao, the iconic consumer-to-consumer shopping mall from Alibaba that’s been rocking China for a decade. In terms of the value of mobile purchases among Chinese consumers, Taobao leads with 75.1 percent market share. Some of that is from the parent company’s B2C marketplace Tmall.

In second place in this sector is Jingdong (formally called 360Buy), which is also China’s second largest B2C e-tailer. Its share of the mobile sector is a lot lower than its share of the overall China B2C shopping market, suggesting that Jingdong – and, indeed, all other such Amazon-like brands – needs to seriously sharpen up its mobile strategy. I notice that, if we again compare mobile spending share with overall market share, it’s only two fashion e-commerce companies that are punching above their weight when it comes to mobile shoppers – own-brand clothing e-store Vancl and specialist handbag site Maibaobao.

Here’s the market share pie chart:

A fairly slow shift to m-commerce

iResearch estimates that Q1 2013 will see Chinese mobile netizens spending a total of RMB 26.6 billion ($4.29 billion) in all of these e-commerce companies. That indicates that 2013 will indeed be the biggest ever year for mobile commerce in China – possibly exceeding the research firm’s earlier estimates of $15.7 billion for the entire year:

In Q1 2013, we see that PC-based shopping still dominates the country’s e-commerce sector , but mobile is rising fast, anticipated to reach 7.6 percent of purchases in the first quarter:

If you can handle any more massive numbers you might like to know that China’s entire e-commerce industry looks set to be worth $177 billion in 2013. Keep an eye on our ‘e-commerce in China’ tag to get more news on this massive market.

China’s Jingdong (formerly called 360Buy) is expanding yet again from its original Amazon-style offerings, this time adding a supermarket channel (see here) to its e-commerce site. The addition brings more than 5,000 types of groceries, packaged foods, beverages, and snacks.

This move is a direct challenge to Yihaodian, the country’s largest food-only specialist e-store, which is majority owned by American retailer Walmart. Like Yihaodian, Jingdong ships its foodstuffs direct from its own warehouses. In contrast, Jingdong’s main rival, Alibaba’s Tmall and Taobao sites, serve as intermediaries for food retailers, and those stores then dispatch the items to online buyers.

Jingdong says that shoppers can buy a single item if they wish, and there’s no obligation to buy a huge virtual basket of groceries. Aside from some common food staples, Jingdong’s new supermarket stocks some interesting imported items that most regular brick-and-mortar stores wouldn’t have, such as Spanish olive oil, or dried mangoes from the Philippines.

One Chinese e-commerce site that recently branched out into global sales has added what could be its hottest item yet – the newest Xiaomi phone. JD Global, the international version of China’s Jingdong, has stocked up on the latest Xiaomi Mi2 phone, which is now available in the 35 countries to which it ships.

Xiaomi’s phones are probably best known to overseas gadget fans for running MIUI, a popular Android skin that can also be flashed onto a number of other Android phones. Since MIUI has a strong global user-base with over 10 million users, the China-made Xiaomi phone actually works well in English. It’s not clear if this version will come equipped with Google apps like the Google Play store.

Only the 16GB version of the recently revamped Xiaomi Mi2S is available on JD Global right now. But, priced at $355 for overseas customers for the WCDMA version – and a further $30 more for the CDMA one – JD Global’s price tags (see here) are not quite so tempting as the RMB 1,999 ($320) price that it sells for in mainland China, Hong Kong, and Taiwan.

Pretty much every time we write about Xiaomi, we get commenters from around the globe asking how they can grab hold of one of the devices. However, there previously wasn’t an easy answer to that. While this global launch is not backed by Xiaomi itself, I get the feeling the phone will get a warm reception from Android fans around the world.

Back in October last year, China’s second-biggest B2C e-commerce site launched a global version of its store that ships items from China. Now, after half a year of operations and a rebrand for the entire company from 360Buy to Jingdong, I was curious how the overseas sales were going, and asked the company for an update.

We’re told that the international site (see here) is handling the rebranding by focusing on the acronym JD, though the frontpage URL of the revamped site hasn’t been updated yet. In its early stages, the Amazon-esque JD Global, which sells everything from iPad cases to wedding dresses, shoes to CDs, is proving popular with overseas Chinese. Jingdong VP of retail and overseas markets, Shi Tao, explains to TechinAsia:

We are getting great early traction selling Chinese language books overseas. Given the number of Chinese living abroad, the challenges of carrying books internationally and the desire of people internationally to keep in touch with Chinese culture, books were a logical early target product. The JD.com Global site has a catalogue of more than half a million Chinese language books for consumers abroad, which is something you just can’t find in foreign markets.

It seems like a good niche market to cater to, as the China-only Jingdong business effectively gives JD Global a larger collection than Amazon’s line-up of Chinese language books in the US or the UK. Plus, there’s an element of trust and brand recognition among this audience and the well-established Jingdong site. Plus, books are generally not a time-sensitive product – which is just as well when global shipping from JD’s China warehouses can take a couple of weeks.

“A bite of China”

Jingdong explains that most of its book buyers are in the US, and that buyers tend to be individuals, not small businesses. The current best-seller on the site is A Bite of China, the DVD and book combo version of the popular cookery program by state broadcaster CCTV. Second is a book on the programming language Java. It’s an odd mix, but it’s apparently what overseas Chinese want. Plus, they get free shipping on purchases over $29, which includes those two popular titles.

Aside from that early traction, Jingdong representatives point out to us that the JD Global site is still at a very early stage, and they’re exploring different demands in different markets and trying to remain flexible.

While JD is unique in shipping to overseas customers from its own warehouses in China, it’s not the only option for consumers looking to buy stuff from China. Jingdong would not compare itself with ‘source from China’ platforms like Alibaba-owned AliExpress or smaller rival LightIntheBox, but there is some overlap in terms of products available on all three, such as things people overseas might really want to buy from China (knowing how much cheaper they are to make in mainland China) such as smartphone accessories or wedding dresses. But JD Global is the only one shipping books, movies, and music to an international audience. Plus, JD would argue that it’s safer to buy direct from them, rather than from other sites that are a conduit for Chinese factory suppliers.

Presumably Jingdong wants a broader audience for its JD Global site eventually, but the Chinese diaspora seems like a good kickstarter.

Jingdong is second only to Alibaba’s Tmall in China’s massive B2C e-commerce market. Jingdong wrapped up a funding round worth $700 million in February, and is said by some analysts to be preparing a US IPO later this year.

Chinese e-commerce giant 360Buy — which I suppose I ought to be calling Jingdong now — quietly picked up the domain wangyin.com on Friday. That may not mean anything to you if you don’t speak Chinese, but it’s the pinyin romanization for the term “online banking” in Chinese, and as such, it sends a pretty clear message about what Jingdong is planning to do with the domain.

Last year, the company acquired the third-party payment company Online Banking, so it seems pretty probable that this domain is meant for that team. But insiders also have said that the company is working on its own payment platform, so it’s possible the domain will also be used for that in addition to whatever the Online Banking team will be doing with it. Or perhaps Online Banking’s services will be merged into the new platform.

So we’ll have to wait and see to find out exactly what Jingdong does with its shiny new domain name, but it’s pretty clear it’s going to have something to do with e-payments. Could it pose a threat to Alibaba’s Alipay?

One of the largest B2C e-commerce sites in China has rebranded to JD.com from 360buy.com. The old domain, 360buy.com, remains and will be redirected to JD.com upon visiting.

The rebrand will make it easier for local customers to remember the URL, as there was previously a disparity between the Chinese name and the website address. Now it makes makes more sense. Also, I know some foreigners who are confused between Qihoo 360 and 360buy. But it should be easier to remember now with JD as the abbreviation of Jingdong. The rebrand is also accompanied by a new logo in the form of Joy, a mascot dog.

Earlier this year, Jingdong raised $700 million from Ontario Teachers’ Retirement Fund (OTPP) and Riyadh-based Kingdom Holding. Prior to that round of funding, Jingdong raised $400 million at a valuation believed to be of $7.25 billion. The company is also believed to be preparing for a US IPO this year.

This rebranding exercise from 360buy to JD will help foreign investors to make more sense of its corporate naming. Richard Liu Qiangdong, founder and CEO of Jingdong said in today’s statement:

Jingdong is delighted to streamline its corporate brand and launch the simpler JD.com domain, which will be easier for our Chinese customers to remember.

U.S.’s Amazon also made the same move by launching Z.cn which helps Chinese customers to remember the domain name better. About a year ago, Alibaba’s Tmall also rebranded to 天猫 (loosely translated as sky cat in English) but with its Tmall.com domain name intact.

]]>https://www.techinasia.com/360buy-rebrands-to-jingdong/feed/2360Buy Employees Abusing Power Over Merchants for Bribes, Free Giftshttps://www.techinasia.com/360buy-employees-abusing-power-merchants-bribes-free-gifts/
https://www.techinasia.com/360buy-employees-abusing-power-merchants-bribes-free-gifts/#commentsTue, 26 Mar 2013 01:30:45 +0000https://www.techinasia.com/?p=114376China’s e-commerce market may be gigantic and hugely profitable, but it’s also still a little bit like the wild west, as regulators are still trying to figure out the best way to oversee the industry without smothering its growth. That means that even at respectable sites, things sometimes go awry, and that’s exactly what happened at 360Buy recently according to the IT Times, which has the story of a 360Buy employee who extorted thousands of dollars and valuable goods out of merchants with the promise of helping them build traffic.

One merchant, a clothing manufacturer, told the IT times that his relationship with the 360Buy operations manager — whose job it was to liase with merchants, discuss activities and promotions, etc. — started out well enough, with the merchant providing the 360Buy manager with free clothing in return for being promoted on the site. This was meant as a friendly gesture, the merchant says, and it wasn’t something the 360Buy manager demanded; the merchant just wanted to give back in thanks for the promotion his site was getting.

But slowly, the 360Buy manager started asking that the clothing company buy him items — expensive items. Plane tickets, laptops, and phones were all on the menu, but the manager was careful enough never to ask directly for the items, rather referring to it as “borrowing” or “purchasing it on behalf of [the manager].” When he received money, it was almost always via friends’ accounts. Still, he never paid back the money spent or returned the items, even when the clothing manufacturer coughed up 30,000 RMB ($4,615), ostensibly to help the 360Buy manager’s friend purchase a house.

Last October, the clothing supplier decided it had finally had enough, and stopped fulfilling the 360buy manager’s demands. Almost immediately, things went south. The company’s traffic dropped, all kinds of problems arose, and payments from 360Buy for purchased items came through slowly, or not at all. The 360Buy manager had an excuse — ‘the purchased items have unresolved complaints filed’ — but that had never caused a delay in payment before the clothing supplier stopped giving him what he wanted.

According to a former 360Buy operations manager in the same position who spoke with the IT Times on the condition of anonymity, an operations manager may have 50 to 100 merchants under their jurisdiction at any given time and they have quite a bit of leeway in terms of who they can give allotted resources like access to the highest profile events and promotions. And the abuse of that power is apparently not uncommon.

It’s a problem that 360Buy and other similar e-commerce sites are aware of, but may have some difficulty combatting. The IT Times report claims that 360Buy CEO Liu Qiangdong addressed the problems in an internal meeting and suggested he was not satisfied with some team members attitudes. Publicly, the company has already responded to the IT Times report with a fairly boilerplate statement about how it is increasing internal controls to eliminate corruption and how it also welcomes oversight from consumers.

But how effectively 360Buy will actually be in combatting internal corruption remains to be seen. More merchants willing to blow the whistle would be an excellent start, but ultimately it seems like this is something Liu Qiangdong and his team will have to address at a more fundamental level.

It was only three months ago that 360Buy, China’s second-largest online store, wrapped up $400 million in funding. Today 360Buy has confirmed an even bigger injection of capital with a fifth round of funding worth $700 million. [UPDATED: The April 2011 round turns out to have been the largest ever, worth $1.5 billion in total, with $500 million of that from Russian investors, DST; the headline and first paragraph have been amended to reflect this].

It means that 360Buy, which is second in the B2C e-commerce sector in China to Alibaba’s Tmall site, has raised well over $2.5 billion since it first got investment back in 2007.

The massive new round saw participation once again from Ontario Teachers’ Retirement Fund (OTPP) along with new input from Riyadh-based Kingdom Holdings, which was founded by Saudi Arabia’s Prince Alwaleed Bin Talal Alsaud.

360Buy’s previous round effectively valued the store at $7.25 billion, but there’s no indication of its current valuation.

360Buy told Chinese media that the newest financing will be used to bolster day-to-day operations, as well as to build up its fledgling logistics service.

CEO and founder Liu Qiangdong has indicated in the past that 2013 was likely a good time for an IPO, but it’s not clear if the new investment would delay that timeline.

]]>https://www.techinasia.com/360buy-biggest-ever-funding-round-700-million-dollars/feed/3By 2016, China Will Have 423 Million E-Commerce Shoppers Spending $457 Billion [INFOGRAPHIC]https://www.techinasia.com/china-ecommerce-shoppers-in-2016/
https://www.techinasia.com/china-ecommerce-shoppers-in-2016/#commentsTue, 12 Feb 2013 09:03:22 +0000https://www.techinasia.com/?p=109451Regular readers will already know that there are now over 200 million Chinese e-commerce shoppers who are spending about $40,000 per second. But with over half a billion people online in China, there’s clearly room for growth. This new infographic made by Go-Globe[1] gives us a good overview of where it’s heading: eventually towards 423 million online shoppers in China spending a total of $457.6 billion in 2016.

The figures suggest that China’s e-commerce scene will not grow exponentially in 2013, and growth will slow every year as the realistic saturation point is finally reached. While the growth in online shopping in the country was over 100 percent from 2011 to 2012, it’ll be down to just 22.8 percent expansion from 2015 to 2016. By 2015, Chinese e-tailers will be taking in 7.4 percent of China’s total retail value.

Aside from all the growth, the infographic gives a good summary of the current players [2] in the B2C e-commerce sector, which is dominated by Alibaba’s Tmall and the perhaps-soon-to-IPO 360Buy. There’s also market share info for e-payments providers in China, again dominated by an Alibaba company (Alipay), along with Tencent’s Tenpay. Here’s the full thing:

2011 saw economic turmoil and financial scandals that led to only two Chinese tech companies venturing to IPO in 2012. But 2013 is looking up. This year there’s the distinct possibility of there being nine major Chinese web company IPOs, among which will be the biggest ever that China has produced.

Buoyed by the solid progress of the small class of 2012 (VIPShop and YY), these are the names to look out for in the year ahead. Inspired by a longer list on QQ Tech, we’ve pruned that down to nine realistic contenders. Some of these Chinese internet companies have been more candid than others when it comes to intent or timing, but they are, to varying extents, likely to be hitting the stock tickers in New York or Shanghai in the months to come.

1. Alibaba

Let’s start with the big daddy, Alibaba Group, which runs market-leading e-commerce sites like Tmall and the iconic Taobao. Just yesterday we wrote of how Alibaba, according to rumor, has already hired two underwriters for its public listing in Hong Kong, thought to be coming mid-2013. Alibaba could well raise US$3 billion to $4 billion at a valuation of $35 billion to $40 billion. Yahoo owns a 20 percent stake.

2. Jingdong

(Update: The site rebranded from ‘360Buy’ to Jingdong in March 2013). It’s difficult to determine which would be the second most valuable company to go public, so the rest of this list is in no particular order. Though I think Jingdong is the next largest. It’s the main rival to the afore-mentioned Tmall in China’s fiercely competitive B2C e-commerce industry. In November of last year, Jingdong attracted $400 million in series D funding, which effectively values Jingdong at $7.25 billion.

2013 has long been pegged as Jingdong’s IPO year, so it’s a case of the online store balancing its ability to attract investors despite a lot of losses on the books with the need to raise a realistic amount. Last year’s reports of it raising up to $5 billion by a public listing might prove to be seriously exaggerated.

3. Sogou

Sogou is the search engine and software division of Sohu (NASDAQ:SOHU). It’s third in China’s volatile search market with 7.92 percent share of pageviews (a few percent above Google) at the end of last year.

Sogou is Sohu’s top earner and has been for 10 consecutive quarters. Sohu bought back Alibaba’s 10 percent stake in Sogou last summer. It’s now ripe for being spun off and floated.

4. Qunar

Qunar has been rumored to be working towards an IPO this year for quite some time, and the CEO of this online travel site even said in January of last year that a listing made sense as soon as “the market stabilizes.”

China’s top search engine, Baidu (NASDAQ:BIDU), invested $306 million in Qunar in the summer of 2011, thereby taking a major stake in the travel store.

5. Vancl

You’ll notice that all but one of the list so far are e-commerce companies. And here’s another. Vancl runs both an own-brand store (like GAP or Uniqlo) online, as well as the V+ open platform mall. Vancl CEO Chen Nian explained recently how its cancelled US IPO at the end of 2011 turned out to be a bullet that he very narrowly dodged. There’s an interesting anecdote about how George Soros helped out.

As with Qunar, the wait for markets to improve is surely over for Vancl.

6. UCWeb

The UCWeb listing is one of the most likely of this bunch. The makers of the hugely popular UC Browser for smartphones, which has over 400 million global users, have made it clear that 2013 is their ticket. CEO Yu Yongfu has already explained that “It would be better for us, branding-wise, to be listed in the US. It would expand our brand name and make us better known.”

7. Cloudary

(Update in July 2013: This isn’t going to happen as the company has ditched all US IPO plans and instead contented itself with a massive funding round). A particularly likely US venturer is the Shanda (NASDAQ:SNDA) spin-off Cloudary, which is its e-book platform subsidiary. A ringing of the bell at the NYSE sometime in April is rumored to be in the cards. Shanda Cloudary – formerly dubbed Shanda Literature – recently appointed a new chairman in ‘Robert’ Qiu Wenyou, a former investment banker at Merril Lynch.

Cloudary, as we saw with Vancl, is another cancelation casualty of a grim capital market towards the end of 2011.

8. Dianping

Heading back into the realm of e-commerce again, Dianping is often called “China’s Yelp” and is also the country’s third-largest daily deals site. But Dianping has not been outwardly chasing an IPO, so this one is far from certain. Nonetheless, the deals service has matured a lot in recent years and now has a claimed 40 million mobile users, so it’s at the stage where it might be ready to go public.

9. Xunlei

Another 2011 IPO withdrawal, Xunlei is very keen to list to raise funds for its growing video streaming site. Back then, Xunlei was aiming to raise $200 million.

Trouble is, Xunlei also has a P2P file-sharing network that’s riddled with piracy. On top of all that liability, Xunlei’s main site is over-reliant on advertising, which is an unreliable source of sustenance. Nonetheless, Xunlei is very likely to resuscitate its 2011 IPO plans pretty soon, now that 2013 is looking like a much better climate for Chinese tech stocks.

Chinese e-commerce giant 360Buy is taking to the cloud, or so it appears with the company’s announcement yesterday of the launch of a major cloud computing research center located in Beijing’s tech-friendly Haidian district. The new research center, founded in partnership with Renmin University, encompasses 10,000 square meters and will be able to employ up to 1,500 workers.

As one of China’s most influential e-commerce websites, 360Buy is in the processof expanding its scope, and we must use scientific methods [to do so] that are based on the multifaceted demands of users and the behavior of consumers […] in the US, England, and the other 500 strongest global companies, more than 90 percent of their important investments and strategic decisions are based on deep data analysis[.]

To that end, the cloud research center will primarily be a facility for hardcore number-crunching rather than the source of a 360Buy-branded entry into the cloud storage market or anything like that. Since 360Buy is engaged in a battle with Alibaba and a few other players for space in the Chinese e-commerce market, every little bit counts, and 360Buy will hope that this new cloud research center will allow the company to move with confidence when they’re making strategic shifts or investments.

]]>https://www.techinasia.com/360buy-founds-major-cloud-research-center-beijing/feed/0How Do China’s Online Retailers Differ from Major Online Retailers of the United States?https://www.techinasia.com/chinas-online-retailers-differ-major-online-retailers-united-states/
https://www.techinasia.com/chinas-online-retailers-differ-major-online-retailers-united-states/#commentsTue, 18 Dec 2012 03:00:47 +0000https://www.techinasia.com/?p=102969This question originally appeared on Quora, and the answers that follow were provided by Ben Chiang, Adventure Capitalist, Zach Brown, a Texan in China, and Grady Ha, marketing and strategy consultant.

Taobao/affiliates have dominated Chinese e-commerce since it began. Taobao is a C2C eBay-like site, T-Mall is a B2C Amazon-like site, and Alipay is a PayPal-like payment service. They have had 70 to 100 percent market share since their inception. Only recently have other sites emerged, such as 360Buy (which has raised well over $1 billion in private capital) in general B2C, as well as vertical or specialized sites focusing on cosmetics/bags/lingerie/kids in direct B2C, flash sales, subscription, or group-buy sales.

2. Delivery expectations

Because of significant investments, mostly by 360Buy and Taobao, Chinese consumers have been trained to expect next-day or even same-day delivery for their e-commerce purchases. Amazon’s CFO recently came out to say they don’t see any way to get to one-day delivery anytime soon [1]. When I think about how Prime/2-day delivery was an inflection point in my own e-commerce buying habits, one-day is even better.

3. They have everything

Seriously. You can find some cool stuff in the long-tail through eBay, Etsy, etc. in the States, but as the majority of the world’s consumer trinkets are made in China, it makes sense that everything you’d want is on there. We recently ordered twenty scratch-n-sniff belts on Taobao for $12, fake Jeremy Lin jerseys for $15 each (rip off!!), then thirty sunglasses for a bachelor party for $15, and finally three inflatable sharks for $7. It makes costume and theme parties that much more fun/easier/cheaper.

1. As Ben mentioned, the express delivery process is one area of difference and probably the most significant of any between the two markets. I work with KuaiDi companies often, and it is firstly awesome, and secondly something that could never exist in the US or most western developed countries. It’s basically cheap labor and strength in numbers drives that industry. Quality is a huge issue though, as the large SF Express and a few smaller others are the only ones not franchised.

2. Consumer preference and product usage varies between US and China (or any other country for that matter), so the product mix and styles you see a brand in US selling may be very different from what that same brand is selling online in China.

3. TMalls B2C Platform has a low cost of entry and huge market reach for businesses, so you can see many foreign brands entering the China market on an e-commerce platform only for their first year or two until they decide to go home or invest more.

4. Security in the US is much further along than China. Whether that is due to actual IT solutions or rather a much smaller number of scam attempts in the US, I am not sure – I would guess both though.

5. Tmall is set up to allow each brand to really differentiate their selling platform. Ebay does not do that as well, and I am not sure there is a comparable platform in the US.

I’m going to jot down a few quick thoughts, as we actually work very closely in this space. Most of the Chinese eCommerce activity is seen through aggregator sites such as TaoBao, Taobao Mall (T-Mall), 360Buy, etc. Aside from the points already made, keep in mind a few more significant differentiators (and this is comparing via B2C aggregator sites such as Amazon and Ebay and does not touch upon B2B, or backend logistics that may involve warehousing, IT platform integration, etc.)

1.Store and Platforms: TaoBao is essentially a China domestic copy of eBay that serves as an aggregator of C2C (Consumer to Consumer) goods. This is where individuals can set up shops using predesignated shop templates, see who browses (and some other basic tracking analytics), maintain and fulfill orders, and send them out based on local distribution/logistic networks that are only limited by physical proximity of the destination to the warehouse (we’ll get to that later). This is mostly where you will see ‘mom-and-pop’ stores as well as distributors of copied goods.

T-Mall, or Taobao Mall, serves as an aggregator of factory/brand authorized goods that require additional verification and has much more stringent regulations in order to ensure authenticity of goods and enhance trust among consumers. This is where most Chinese consumers will go if they wanted better quality of goods backed by brand authorized distributors.

Major differentiators here include a relatively good search algorithm (although it is lacking in cross-shopping/selling features), goods that are tailored to the Chinese consumer (which includes a wide variety of products and product lines that would contribute to point 3 that Ben made), and what I perceive to be a major integration of social messaging/instant messaging utilizing WanWan/QQ for customer support before/during/after the shopping process.

2. Distribution: Here is where it gets very interesting. I won’t get into the specifics about SKU distribution, or product line decisions and warehousing – but logistics and distribution is a whole different animal as compared to the U.S. In the U.S., essentially both customers and shippers have three major options (USPS, UPS, and Fedex). All of them have varying degrees of shipping speed, tracking, and drop-off/pick-up options. In China, despite recent attempts at standardization and consolidation of logistics, there are still a multitude of companies that operate via motorcycles/courier networks that can deliver with relative speed accuracy. That is to say, you live next to where the product is actually being shipped out.

Despite all the touting about one-day or same day shipping, if you don’t live in a city that has a warehouse where the product is coming out from and where the courier can pick up relatively soon/effortless, you’ll get the product within a few days to a few weeks. I witnessed first hand as the coordination between shipper and logistics company was a cross-calling mess as we tried to ship a product by calling the logistics hub, and the hub called the delivery driver (who physically had to come to the warehouse and pick up the item) – and in the middle of all this it requires coordination by all parties just to have the item shipped outbound. If the warehouse was located farther away from the city, or if you lived in a more remote area, the product will simply take an extraordinary longer period of time to arrive (without an accurate tracking mechanism to boot).

3. Trust: Trust means both trust in the website itself, products, and payment platforms. Recently with Alipay, it’s become much better as consumers load credits onto their Alipay account, which makes Alipay (or other payment platforms) serve as the middle man, and therefore take on some of the inherent risk. Previously, direct transactions by credit card weren’t regulated by industry security standards and simply served to dissuade consumers from shopping online, and requiring a COD option, as handing physical cash (or returning the item directly if the consumer was dissatisfied) felt more secure than sending financial information electronically.

T-mall additionally provided an aggregator of verified distributors that sold goods that consumers can be sure of. Due to the availability of counterfeit goods, Chinese consumers are simply more wary and concerned about if they are really getting what they pay for.

There are a huge amount of counterfeit sites that sell counterfeit goods. Even on T-mall/TaoBao, we are seeing stores set up by unauthorized retailers (which T-Mall subsequently takes down) that erode consumer trust.

Chinese e-commerce site 360Buy seems to be cranking out new features on a daily basis. Yesterday, an e-bookstore; today an app store. 360Buy’s newly-launched apps market offers Android applications and games, and is yet another alternative to Google Play in China.

It enters a very crowded market for third-party Android app stores in the country, while also giving 360Buy a more Amazon-esque line-up of digital offerings.

This new app marketplace (at play.360buy.com) is all part of 360Buy’s digital diversification, which will eventually cover nearly all the bases in online entertainment: e-books, online games, music, and video. So far, it’s three down and one to go – streaming video must be next.

‘360Buy Apps’, as it is called, comes with a market app for Android phones, and there are also upcoming apps for Android tablets and for Windows PCs. The PC app will offer an iTunes-like syncing experience for Android users, something that Google avoids, instead prefering to do syncing in the cloud. But Chinese users have never been so keen on that. Indeed, lots of Chinese sites have opted to fill this niche with their own syncing apps, such as the startup Wandoujia, right up to China’s biggest web company, Tencent, with its App Assistant.

Putting our skeptical hat on – which is, by the way, our favorite hat – some might say it’s wise for 360Buy to offer more digital content at a time when it’s still struggling to turn a profit. That’s because it’s relatively cheap to expand its line-up in this way – perhaps the cheapest possible area of expansion of them all. But that doesn’t mean it’s a good idea. Indeed, it’s a very late entry into the third-party app market scene, and it doesn’t make much sense to try such a low-profit portal. My colleague Willis is less charitable and reckons that this is “seriously stupid” and diluting the company’s focus on e-commerce sales of books, clothing, and electronics.

360Buy, despite its recent series D funding worth $400 million, is thought to be really in need of greater cash-flow.

One of China’s top e-commerce sites, 360Buy, has opened an online music store that promises music downloads as cheap as one-tenth the price of CD songs. It has come online with the name LeMusic, and already has apps for iOS, Android, and PC.

360Buy’s new MP3 store – at music.360buy.com – has a fairly small selection of licensed music that’s either free or paid-for, depending on the songs or albums. This will presumably grow with time. The e-tailer has said that its music will “cost one-third to one-tenth the price of CDs” and marks the continuation of the site focusing on more digital content; it has already ventured into online games and e-books, and will likely also push into software and online video.

The 360Buy LeMusic service also offers streaming music, and its apps can additionally serve as a general player for any music you already have in your laptop or smartphone. It’ll be up against a variety of local rivals – from social sites like Xiami, to search engine behemoth Baidu and its newly re-branded Music service. Neither Amazon not Apple’s iTunes sell MP3s in the China market.

The 360Buy LeMusic homepage. Click to enlarge.

We recently looked into the likelihood that China’s era of free MP3 downloads (even of licensed and ad-supported songs) will soon be at an end, and that a group of Chinese sites and web portals are banding together to roll out paid music subscriptions next year. It’s not clear if 360Buy will be part of that joint effort.

[UPDATE 1: This was all confirmed by the company later in the day. The story’s text has been amended to reflect this just in the first and final paragraphs].

Earlier this year we suggested that 360Buy, China’s second-largest B2C e-commerce site, was focusing on a major new funding round rather than prepping a US IPO. And that is now a reality today with earlier rumors on ChinaByte being confirmed by the company that it has secured series D funding worth $400 million.

The huge fourth round of funding for 360Buy is led by Ontario Teachers’ Retirement Fund (OTPP), with participation from the Tiger Fund. As large as the investment amount is, it effectively values 360Buy at $7.25 billion, which is a lot less than the $10 billion or more that the e-tailer was pegged at after its $500 million injection from DST in April of last year. Indeed, means 360Buy’s valuation has been slashed by a quarter. [UPDATE 2: A DST spokesperson has reached out to clarify that, at the point of DST’s investment in 360Buy in June 2011, “360Buy was valued at $6 billion” – and not $10 billion, a figure which was bandied about last year. So the suggestion here (though DST cannot confirm the size of its stake) is that 360Buy’s valuation has actually grown].

Ontario Teachers’ Retirement Fund is Canada’s third-largest retirement fund. Bloomberg reported last week that the OTPP is planning to open a Hong Kong office in 2013 as a part of its strategy to diversify the group’s investments.

This summer I asked what on earth 360Buy is truly worth, amidst wildly fluctuating numbers of its eventual evaluation when it finally lists publicly. Some in the e-commerce industry in China reckon that 360Buy should not be evaulated on the same price-to-sales ratio as Amazon, since 360Buy is in a much less stable a position compared to Amazon in the US and many other markets. To cut a long story short, some industry experts reckon that a valuation of $5 to $6 billion is closer to the mark.

360Buy confirmed the news later on Tuesday after many initial reports about the new funding round being secured. CEO and founder Liu Qiangdong has been unusually quiet on social media in the past month and hasn’t commented personally on this.

That makes Tmall and Taobao’s Double Eleven sales worth more than double America’s entire Cyber Monday shopping spree, which brought in $1.25 billion in 2011. With Cyber Monday in the US growing at only about 22 percent per year, it’s unlikely that the next one, on November 26th, will see American consumers outspend their Chinese counterparts.

Back in 2011, Taobao and Tmall brought in $830 million in sales transactions on that special shopping day, so the two sites saw that figure grow by just over 360 percent.

Alibaba said this morning that it saw more merchants than ever take part on the sales day, with even major brands like Nike and Uniqlo offering discounts on their Tmall virtual stores. This year, a total of 10,000 sellers on Alibaba’s sites joined in the action, up from 2,200 last year. [UPDATED: Here are a couple of extra stats from Alibaba related to m-commerce purchases yesterday]:

The ratio of Taobao users using PC to those using Taobao Mobile on November 11th was 3:1, and the ratio from last year was 5:1. In the first hour, nearly 7 million registered users logged onto their Taobao Mobile app and reached RMB 100 million in transaction volume. Taobao Mobile hit RMB 940 million [$149.8 million] in transaction volume [in whole 24-hour period].

Of course, all of China’s top e-commerce sites took part in the event, with sales of up to 50 percent on some items, and a host of other offers and gimmicks. But other major sites in the country have not revealed sales figures for the full day, making it hard to piece together exactly how much was spent online during yesterday’s Double Eleven. Tmall’s closest rival in the B2C market, 360Buy, has not yet given any clues as to its performance, while the electronics retailer Suning (SHE:002024) revealed only that it got nearly three million orders and saw twenty times more sales this year than last.

51Buy, which is a much smaller Amazon-esque site, was a bit more forthcoming with its stats and said that RMB 50 million ($7.97 million) worth of stuff was sold up to 4pm yesterday, which was up 630 percent on its performance the year before. The online shopfest ran to midnight, so 51Buy will reveal updated figures later.

Wait… Is this how e-commerce works? I’ve been doing it wrong. (Photo: Getty Images)

November 11th became a bizarre and jokey Single’s Day in China in the 1990s, celebrated as a sort of anti-Valentine’s day. But back in 2008, the iconic date – 11/11 – got a new meaning, and a greater urgency, when China’s top e-commerce site, Tmall, decided to turn it into a huge online shopping sales day. It quickly became a new national institution, and now all the country’s e-commerce sites join in the cut-price e-commerce spending spree that’s known as Double Eleven. 2012’s Double Eleven looks set, for the first time ever, to surpass America’s Cyber Monday in terms of sales volume.

Last year’s Cyber Monday in the US, in data from ComScore, saw $1.25 billion in sales, which was up 22 percent from the previous year. But China’s Double Eleven, with discounts of up to 50 percent on many items – is poised to pass that huge stat. 2011’s 24-hour online spending spree in China raked in US$830 million in transactions for just the two largest sites in the country, Alibaba’s Tmall and Taobao – and that figure was up 373 percent from the previous year. Sadly, nationwide stats for all sites are not available.

So – brace yourselves for this – China’s Double Eleven online shopfest tomorrow will not only be bigger than America’s comparable day, but just two Chinese sites will likely beat that $1.25 billion sales figure by themselves.

Shop Till You Drop

Tmall’s special sales page…

… and this is 360Buy’s. Nobody said it’s gonna be pretty.

Looking at China’s top B2C e-commerce sites, they’ve all put up promotional pages ready for tomorrow (pictured above), and for months beforehand have been stockpiling inventory, hiring extra staff, and making sure that their site is up to the task of being hit by hundreds of millions of shoppers all at once.

The top five B2C shopping sites in the country – Tmall, 360Buy, QQ Buy, Suning, and Amazon China – are all pushing their Double Eleven deals to varying extents. The brick-and-mortar electronics retailer Suning (SHE:002024) is being particularly aggressive – as it has been in general for the past year or two, pushing its business more online – by giving away a small selection of stuff for free; plus, some of its other deals are available for three days, not just the regular 24-hour window.

China’s e-commerce market is also a ferocious area that has seen a few specialist sites fail earlier this year as the major e-tailers consolidate power and market share. It’s also a sector that sees a lot of price wars, so the Double Eleven shopfest is actually one of many chances for consumers to get a discount. Hopefully consumers will be looked after and not exploited tomorrow – we don’t want a re-run of some previous price wars that have seen stock for some items severly limited, leaving e-commerce shoppers feeling angered by an apparent bait-and-switch tactic. After all, sales should not be a blow-out, but a chance to win over new customers.

China’s second-largest e-commerce site, 360Buy, has opened up an English-language site that will ship items to 35 countries worldwide. The site has just gone live minutes ago at en.360buy.com. The site’s help center points out that it’s only accepting Paypal as a payment method for now, and all goods will be shipped out of China, causing lengthy delays.

As I first suspected when I heard this news, 360Buy is not truly launching in lots of markets, with warehouses and stock in numerous countries – as Amazon (NASDAQ:AMZN) has done. Rather this sees 360Buy using its existing resources in China to reach out to customers worldwide. But it remains to be seen if prices can be kept competitive – and if length shipping times will prove off-putting. The new 360Buy help center in English says that shipping can take three to six days with DHL or UPS, but as long as “15 to 20 business days” for “supersaver” options like China Post or Singapore Post.

Click to enlarge.

360Buy’s new global site says it’s trying to offer free shipping where possible, but “Free shipping is only available for the SuperSaver shipping method.” So free shipping can doom you to waiting nearly a month for something to arrive.

But the site has some charms. It could be used as a way for individuals to source cheap items from China – sort of like with the Alibaba.com service, except you don’t need to be a business that’s buying wholesale amounts.

I notice the 360Buy global site is heavily marketing things like wedding dresses – a prime example of something that can be made cheaply in China and that would be in demand in a lot of markets at a healthy profit margin. Same for smartphone and tablet cases.

To back up its global efforts, 360Buy now has social presences on Twitter, Facebook, and Google+ as a way of dealing with customers.

]]>https://www.techinasia.com/360buy-english-site-global-sales/feed/0China’s 360buy Set to Go Global, Plans to be the Next Amazonhttps://www.techinasia.com/360buy-overseas-expansion/
https://www.techinasia.com/360buy-overseas-expansion/#commentsThu, 18 Oct 2012 01:20:31 +0000https://www.techinasia.com/?p=95884

China’s 360buy has been something of an anomaly late, as the e-commerce giant has been expressing interest in other areas like advertising platforms, e-payments, and even games. My colleague questioned the company’s commitment to e-commerce a few weeks back, speculating that exploring other business models might be a potential ‘plan B’ if its fortunes in China’s e-commerce wars take a turn for the worse.

But according to China Daily interview with the company’s vice president Shi Tao, 360buy is about to double down on e-commerce, doing so on a global scale. The company will reportedly launch an English version of its website (the ‘coming soon’ placeholder is at en.360buy.com), with the goal of delivering products to over 36 countries, particularly in North America and Europe. 360buy has also opened up social presences, with Twitter, Facebook, and Google Plus accounts now active.

360buy will be an interesting case study among all the other Chinese internet companies looking to do business abroad. I would posit that unless you are in e-commerce where the perception of cheap is to your advantage, the made-in-China brand will be a toxic one for most Chinese companies set on global expansion. China’s failure to develop soft power, combined with the government’s perpetual dickishness [1], is creating significant impediments for Chinese businesses abroad. The recent troubles of Huawei and ZTE, as well as Baidu’s issues in Vietnam are examples of this.